Fixed-asset reserve can save you headaches down the road

If you have recently completed a major capital expansion or you are settling into a brand new facility, it’s likely that the last thing on your mind is future building repairs and/or replacement. Like the cars we drive, building components experience wear and tear and eventually require our attention. Also, like cars, the timing of these repairs can be predicted.

It has been my experience that 20 years of building age is equivalent to about 100,000 miles on a car — things just start to break. Fortunately, because replacements can be predicted, building owners can plan for expenses using a tool called a fixed-asset reserve.

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